Effects of Volatility of the Exchange Rate on Inflation Expectations and Growth Prospects in Mexico (2002-2014)

Guillermo Benavides (), Isela Elizabeth Téllez-León () and Francisco Venegas-Martínez
Additional contact information
Guillermo Benavides: EGADE Business School, Tecnológico de Monterrey, Campus Ciudad de México. México, D.F. Mexico.
Isela Elizabeth Téllez-León: Escuela Superior de Economía, Instituto Politécnico Nacional. México, D.F. México.

Ensayos Revista de Economia, 2015, vol. XXXIV, issue 2, 63-78

Abstract: This paper is aimed at assessing the impact of exchange rate volatility on inflation expectations and economic growth prospects in Mexico. In order to examine whether there is some degree of causality, we will be using standard multivariate volatility models. The goal of this research is to measure the direction of causality, that is, we will analyze, econometrically, potential relationships in both directions. The main finding is that there is only a statistically significant relationship between the exchange rate volatility and the volatility of inflation expectations, while no statistically significant association with growth prospects was found; these results provide important information that could be used in monetary policy design.

Keywords: Exchange Rate Volatility; Monetary Policy; Time Series Analysis (search for similar items in EconPapers)
JEL-codes: C12 C18 E52 F31 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.economia.uanl.mx/revistaensayos/xxxiv/2 ... Mexico_2002_2014.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ere:journl:v:xxxiv:y:2015:i:2:p:63-78

Ordering information: This journal article can be ordered from

Access Statistics for this article

Ensayos Revista de Economia is currently edited by Edgar Mauricio Luna Domínguez

More articles in Ensayos Revista de Economia from Universidad Autonoma de Nuevo Leon, Facultad de Economia Avenida Lazaro Cardenas 4600 Ote., Fraccionamiento Residencial Las Torres, C.P. 64930. Monterrey, Nuevo Leon. México.. Contact information at EDIRC.
Bibliographic data for series maintained by Dora María Vega Facio ( this e-mail address is bad, please contact ).